Wednesday, February 17, 2016

So Sunday night, in the middle of a completely unrelated personal drama, I opened an envelope that I expected would be junk mail. The return address said "American General Life Insurance," and since I don't have a policy with American General, I figured it was an offer to sell me insurance. But it also had the no-frills look of some of those financial come-ons from no-name companies, the ones that have a check inside for thousands of dollars that constitutes an instant loan for godawful interest.

So I decided to open it to see if it was something I needed to destroy. But instead of an ad or a check, it was a bill, asking me for a payment of $25 against a loan of $3160, made against my life insurance policy.

Two problems:

1. I never took out a loan against my life insurance because...

2. I had never bought a life insurance policy from American General.

My first thought was that someone actually had stolen one of those "checks" from my mailbox and cashed it, leaving me on the hook to repay their loan. But thinking more about the way it was worded, that I owed for a loan against my policy, I thought maybe my identity had been stolen.

The notice included an 800 number to call as well as a website. So I decided to check out the website and see if it was at all legitimate. And it was weird. The website was for AIG, which is a huge insurance company. But when I checked the phone numbers and addresses on the website, nothing quite matched the notice I'd gotten in the mail. The 800 number didn't match any of the numbers I found on different pages of the website, and although both the website and the mailed notice had P.O. Boxes in Nashville TN, they were different numbers.

This was not definitive proof of anything either way, though. Big companies have lots of phone numbers and boxes. But there was nothing that confirmed this was a legitimate notice, either. Even the second page, giving some further information about the company, listed the abbreviation for the company as AGL rather than AIG. So was this a legitimate notice or a clever hoax designed to look like it was from the big company?

I ended up getting very frustrated and sending out an angry tweet worded thus:

Received a notice from a fraud factory called American General Life Insurance, which may be @AIGInsurance. Interesting business plan.

A follow-up tweet went on to mention that they had gone straight to the billing phase, without ever doing the provide-goods-and-services part, but it doesn't look like that tweet actually went out.

I sat around stewing all the next day, because it was Presidents' Day, and AIG wasn't open. But I did receive a reply to my tweet early Tuesday morning, asking me to call a particular number. I called the number and went to the voicemail of someone named Stacy Golden, who was out of the office, but if this was urgent, I could call another number and talk to a different representative. So I called the different number, which took me back to the same voicemail. Which started me wondering again if this was all part of some really elaborate hoax.

I finally called the number from the AIG website, stayed on hold forever, and talked to a rep who finally confirmed that yes, a policy did exist under the policy number listed on my notice. And when I protested that I had never taken out a policy, she told me a detail that made some pieces fall into place.

The policy had been taken out in 1965. I was two years old at the time.

So this was a policy that my parents had taken out on me that I had no knowledge of. But it still didn't explain the loan. She had to transfer me to a specialist to deal with the loan part, though. After another ten minutes on hold, I got more of the story.

There had been no premiums paid on the policy since 2002. And since it was a whole life policy, it didn't lapse if the premium wasn't paid. Instead, the premium would be paid out of a "loan" taken out against the cash value of the policy. And so the amount had grown for 14 years, from unpaid premiums and accumulated interest on that unrepaid amount every year, until I owed over $3000 against a $5000 policy.

I called my dad and he said, yeah, there was a policy, but he thought they had been taking the premium payments out of his bank account automatically.

So now I'm faced with a few possible courses of action, none of them very satisfactory. I can do nothing, have the debt continue to pile up until it exceeds the value of the policy, at which point they sic collectors on me maybe? I can pay the debt and continue to pay premiums and receive a $5000 payment once it matures when I'm 65. I can just pay the premium and annual interest (about $200 a year) until it matures and receive an $1800 payout. Or I can cash out the policy now, before it has matured. I don't get as much money, only about $175, but I don't have to worry about any of this crap again.

That last one is the option I'm leaning toward.

But what disturbs me is how I just accidentally discovered the situation, and how close I came to having this problem continue to grow. It reminds me of that famous Donald Rumsfeld press conference about Iraq, mocked by liberals, when he talked about "known unknowns" and "unknown unknowns." This is a perfect illustration of that principle.

There are several things I don't know. How the premiums stopped being paid. How my parents never noticed. How AIG somehow tracked me down, and how long they might have been sending me notices that I threw away unopened because I thought they were junk mail.

The difference between now and say, Saturday, though, is that Saturday I didn't know any of these things were issues. Now those are things I am aware that I don't know, while before, I didn't know an entire category of things I didn't know.

Now I wonder how many more of these kinds of things are out there, secret bombs from my past that I have no idea exist until they suddenly explode into my life.